Event: overclocking 3 released three-quarter report in 2022, the company achieved operating income of 821 million yuan in the first three quarters of 2022, + 127% year-on-year; net profit of 35.2541 million yuan, + 301%; deduction of non-return net profit of 29.5254 million yuan, + 220%; of which Q3 achieved revenue of 241 million yuan, year-on-year + 93%, month-on-month-2%; return-to-mother net profit of 4.9599 million yuan, year-on-year + 119%, month-on-month + 28%.
Comments: the proportion of lithium recycling business continues to increase, taking over the company's main development baton. In August last year, the company realized the holding of Gejiu Sanbi, a lithium recycling company (currently 50.14%), and gradually adjusted the lithium battery cathode material business into the company's main business. Gejiu Shengbi and deep ploughing waste lithium batteries have been recycled for more than ten years, and they are one of the few lithium ion materials manufacturing enterprises in the industry with the complete industrial chain technology of "comprehensive recycling of waste lithium ion battery materials / lithium carbonate → cathode materials". In October this year, it was successfully selected as the fourth batch of national specialized new "Little Giant" enterprises. The rapid development of the new energy industry has led to a continuous increase in the demand for lithium materials. Thanks to this, the product sales, price and profitability of Gejiu Sanbi have increased significantly compared with last year. In order to continue to expand the business, the company issued a simple fixed increase of 200 million yuan this year to form a new production capacity of 10000 tons of ternary precursors, 3000 tons of lithium carbonate and 5000 tons of ternary cathode materials, which is expected to be completed by the end of this year.
Weak consumer demand is under short-term pressure, and the future release of power capacity is expected to return to normal. The weak consumer demand affected by many factors since Q2 has led to a decline in the demand for consumer battery cathode materials for the company's products. With the release of new capacity of cathode materials for power batteries next year, the lithium battery materials business is expected to rise in volume and profit next year.
The heat dissipation business is exploring new models, and the lighting business remains stable. The company's consumer electronics cooling accessories were originally mainly oriented to the assembly machine market, focusing on the C-end market, and now the company has gradually developed a new mode of B-end cooperation. In addition, the company also stores new heat dissipation products such as ultra-thin heat pipes and base station heat dissipation modules, which can be used in mobile phones, communication base stations and other fields. LED lighting business maintains stable operation.
Investment suggestion: we estimate that the company's 2022Universe 2023Universe operating income in 2024 will be RMB 11.41 million, respectively, with a year-on-year increase of + 97%, 136% and 34%, respectively. The estimated net profit of homing will be RMB 0.56 and 2.07, respectively, and the year-on-year + 135% PE will be 0.12, 0.45 and 0.63, respectively, and will be rated as "Buy" for the first time.
Risk hint: capacity construction is not as expected and lithium demand is not as expected.